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  • #1182960
    JimGrey
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    Also, I’m a bit miffed that I purchased some expensive computer gear before the $20k asset write off was announced. What’s the law on “2nd hand” goods in this regard? Can I sell the computer gear, then buy it back immediately to be able to claim the write off?
    Yes there are always going to be people who have been caught out and spent on assets just before the new laws apply. But I am interested if there are any ways around it… especially since these purchases were for setting up a brand new business, which is essentially something the Govt is trying to promote with these incentives.

    #1182961
    James Millar
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    jamesgrean, post: 214104, member: 60501 wrote:
    If we have an existing chattel mortgage, and this carries into the financial year, and the 12 months of mortage repayments come to $15,000, can we write off that?
    Or, put another way, can we buy a $40k asset and “pay” $20k each year for 2 years, and write off each $20k payment?

    No you cannot write off the annual finance payments. The asset must be acquired within the dates and must cost less than $20k. Finance payments have no bearing on this threshold.

    Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900
    #1182962
    James Millar
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    jamesgrean, post: 214105, member: 60501 wrote:
    Also, I’m a bit miffed that I purchased some expensive computer gear before the $20k asset write off was announced. What’s the law on “2nd hand” goods in this regard? Can I sell the computer gear, then buy it back immediately to be able to claim the write off?
    Yes there are always going to be people who have been caught out and spent on assets just before the new laws apply. But I am interested if there are any ways around it… especially since these purchases were for setting up a brand new business, which is essentially something the Govt is trying to promote with these incentives.

    I think its probably a case of bad luck any many are in your position. I’m not sure what the economics of selling and then repurchasing would look like but I’d imagine you would waste a lot of time and money selling computer gear to buy and setup again. If it was done on a non arms length contrived basis I think the audit penalty risk would be high.

    Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900
    #1182963
    Melpal75
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    James do you know if the 20k includes GST or excludes it? Ie can the total drive away price be around $21800 or does it need to be totally below $20k??

    What happens if you only use the car for 80% business use?? I am a sole trader

    I have been operating as a sole trader since sept last yr, my income is over $85k…..am I still eligible if I can’t provide details for the past three years? Just for information I have been doing the same job for the past 7 yrs but upto sept last year I used a contractor management company as was classed as a PAYE

    Thanks in advance

    Mel

    #1182964
    James Millar
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    Melpal75, post: 214503, member: 67767 wrote:
    James do you know if the 20k includes GST or excludes it? Ie can the total drive away price be around $21800 or does it need to be totally below $20k??

    What happens if you only use the car for 80% business use?? I am a sole trader

    I have been operating as a sole trader since sept last yr, my income is over $85k…..am I still eligible if I can’t provide details for the past three years? Just for information I have been doing the same job for the past 7 yrs but upto sept last year I used a contractor management company as was classed as a PAYE

    Thanks in advance

    Mel

    The $20k will exclusive of GST. My understanding is that you would be required to adjust the claim based on any element of non business (private) use.

    Sorry I don’t follow the last part of your question regarding the $85k and past 3 years. Could you clarify.

    Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900
    #1182965
    Melpal75
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    Thank you James…………I will check that out.

    With the 3 years and earning over 85K….I have read that one the rules you need to qualify for to be eligible for this $20k is you need to show that you have been running a business for the past three years……….obviously I have not been running as a Sole Trader for the past three years, however I have been operating as a contractor but my money is being managed by a contracting management company. I assume if you didn’t understand what I was talking about then maybe this isn’t a rule that we need to qualify for???

    Thanks in advance James

    #1182966
    James Millar
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    Melpal75, post: 214636, member: 67767 wrote:
    Thank you James…………I will check that out.

    With the 3 years and earning over 85K….I have read that one the rules you need to qualify for to be eligible for this $20k is you need to show that you have been running a business for the past three years……….obviously I have not been running as a Sole Trader for the past three years, however I have been operating as a contractor but my money is being managed by a contracting management company. I assume if you didn’t understand what I was talking about then maybe this isn’t a rule that we need to qualify for???

    Thanks in advance James

    I am not aware of any three year test requirement for this. Could you please send me your reference for this. Perhaps you are referring to non commercial loss provisions (which are only relevant if you make a loss)

    Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900
    #1182967
    Melpal75
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    Hi James, I can’t find where I read it, it might of been in an article…..which of course may not be accurate:)

    Have you heard anymore about this bill and when it might go to parliament?? We are keen to get a car however we think maybe we should wait until the legislation is passed through the parliament??

    #1182968
    James Millar
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    Melpal75, post: 214922, member: 67767 wrote:
    Hi James, I can’t find where I read it, it might of been in an article…..which of course may not be accurate:)

    Have you heard anymore about this bill and when it might go to parliament?? We are keen to get a car however we think maybe we should wait until the legislation is passed through the parliament??

    That’s a very good question. Given the debacle in getting the 2015 budget measure through I would not be surprised if this dragged on for quite some time. Where does that leave the average small business taxpayer? Basically no man’s land. However the ATO will generally give an amnesty penalty free amendment if the law does not pass. That means you get to pay your accountant to redo your books and you also forgo the tax benefit that probably incited you to buy the item.

    I’m afraid this is the sad state of Australian politics and lawmaking. No political mandate, mixed senate arrangements – basically anything can be blocked for any reason. If we conducted private enterprises in such a way we would all be out of business.

    Stay tuned for updates – we will be sure to post them here as they evolve.

    Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900
    #1182969
    James Millar
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    http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r5466

    Update on this measure. The bill was in fact tabled last week and by all accounts this measure has bipartisan support. I believe they are hoping for senate approval in next two weeks so there should be clarity before 30 june.

    Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900
    #1182970
    Melpal75
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    Thank you James, I greatly appreciate it

    #1182971
    bb1
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    JamesMillar, post: 214924, member: 5318 wrote:
    That’s a very good question. Given the debacle in getting the 2015 budget measure through I would not be surprised if this dragged on for quite some time. Where does that leave the average small business taxpayer? Basically no man’s land. However the ATO will generally give an amnesty penalty free amendment if the law does not pass. That means you get to pay your accountant to redo your books and you also forgo the tax benefit that probably incited you to buy the item.

    I’m afraid this is the sad state of Australian politics and lawmaking. No political mandate, mixed senate arrangements – basically anything can be blocked for any reason. If we conducted private enterprises in such a way we would all be out of business.
    .

    Looks like it will get through, but if it doesn’t there must be some good lawyer out there, who could start a class action on behalf of the 1.8 million small business’s who have gone out and spent up based on the indication in the budget, but also the TV advertising going on at the moment indicating it is all GO GO GO.

    #1182972
    Melpal75
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    Thank you James….who know:)

    This is what I read re the 3 years as a business

    Eligible businesses must turnover more than $20,000 per year and less than $2 million, the real estate assets of the business must be worth more than $500,000, other assets must be more than $100,000, and the business must have made a profit in three of the last five years.

    My husband just sent this too me aswell to review…..have you seen this?

    Thanks

    Mel

    #1182973
    bb1
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    Melpal75, post: 215011, member: 67767 wrote:
    Thank you James….who know:)

    This is what I read re the 3 years as a business

    Eligible businesses must turnover more than $20,000 per year and less than $2 million, the real estate assets of the business must be worth more than $500,000, other assets must be more than $100,000, and the business must have made a profit in three of the last five years.

    My husband just sent this too me aswell to review…..have you seen this?

    Thanks

    Mel
    Where did you read t, do you have a link,

    #1182974
    Melpal75
    Member
    • Total posts: 9
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